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Improved segmentation for a higher ROI

Some of the most important challenges facing marketers is knowing the types of people who populate your database, their preferences and intentions, and the types of messages to which they are most receptive.

Creating the right groups in this context, based on a set of shared characteristics and factors, is, in a nutshell, the art of segmentation. Segmentation offers a huge amount of untapped potential. The sheer volume of data that can be channelled into segments is enormous and, given the right tools, these advanced segments can be made increasingly actionable. You can communicate personally, at detailed level, and get more bang for your marketing buck too. In this article I’ll show you the quickest way to exploit that untapped potential. Segmentation in 2018 entails more than just using data from your CRM system. Nowadays data gives us insights into the clicking behaviour of customers who visit your website, how they react to online advertising and how they behave on various channels. Reconciling different data sources about a customer and creating relevant marketing campaigns around them is both a challenge and an opportunity.

 

Empower your marketer

The increasingly important role that technology plays in marketing can make it difficult for marketing people to use data obtained from various sources to create segments. It calls for a great deal of technical know-how, or it might even be the case that the turnaround time to create a segment is (too) long, due to the marketing department’s reliance on IT people to deliver the segment. Moreover, the interfaces that can unlock the data are often not conducive to explorative experiments with the available data. Using a low-threshold tool like Audience Creator removes hurdles. Little or no technical expertise is needed to unite different values and fields via a drag & drop interface to see which segments are then created. Marketers can then make a better and quicker assessment of whether it’s worth setting up a specific campaign for a certain segment. Accessible marketing technology reduces marketers’ dependence, increases their decisiveness and allows for more flexibility.

 

Derive more value from your existing customers

Increasing the speed and accessibility of segmentation will enable you to ascertain the value of your customers much more accurately. You can, for example, look at things like order-recency, order-frequency and the financial value of those orders. This will give you invaluable insights into who your new customers are, which ones are the most loyal, which ones represent the most value and which customers pulled out in the past. You can then configure one or more campaigns in each of these segments. This will allow you to win back customers or “push” the highest-value segment by communicating a relevant message or offer. It’s been demonstrated in the real world that turnover per message (revenue-per-message) is significantly higher for organisations that use segmentation.

 

Finding new customers that resemble your best customers

If you can identify who your best customers are, you can use that segment to improve your online acquisition campaigns. This means searching for look-alike-audiences, people with similar characteristics to your best customers, on platforms such as Google and Facebook and those that communicate a very specific message. In effect, this is a low-threshold way of searching for potential customers who might represent high value. It’s much smarter to use your advertising budget by spending it mainly on target audiences for which you can predict that the conversion likelihood will be the highest.

 

Optimising for more impact

That extra bang for your marketing buck can also be found in broader opportunities for low-threshold experimentation with segmentation. Firstly, there will be a shorter turnaround time for optimisations that generate comparable impact, as well as more variation possibilities to experiment with. An experiment could, for example, be created by connecting external data sources with a tool such as Audience Creator. This would combine segmentation with smart marketing automation to produce effective and event-driven communication. Incidentally, this isn’t the same as random segmentation. You should always experiment with a control group against which you can compare your segments. This will allow you to test as best you can whether you really will generate more impact. In the short term it’s about getting results by focusing on the low-hanging fruit. The long-term gain however, is to be found in the fact that you’ll be making the systematic experimentation and optimisation of all your campaigns to improve the result, an intrinsic part of the DNA of your marketing operation.

 

Start small then scale up

Step one of tapping into and exploiting the potential of segmentation begins with knowing where the data is in your organisation and how you can unlock and combine that data. Step two is to provide insights into how extensively segmentation and personalisation have already been used in your current campaigns and then analyse the performance of these campaigns. Step three comprises the optimisation of current campaigns to realise better results. Finally, there needs to be a roadmap for all future campaigns, prioritised on sales and/or service value and the degree of complexity of its technical execution. Initially, the focus must always be on campaigns that represent relatively high value while also being technically quite easy to implement. That’s the way to book tangible results that really contribute to marketing success.

 

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